FONDEA: another way to support companies with fund...

FONDEA: another way to support companies with funding

In view of the situation faced by micro, small, and medium-sized businesses, the State Government of Aguascalientes, through SIFIA and in coordination with the business sector, launched the Fund for Business Development of Aguascalientes (FONDEA). The fund includes the Program for Business Loans and the Program for Business Development Loan.

The programs will support companies with liquidity problems pay its operating expenses, acquire raw materials, and buy equipment through subsidies and loans.

“These are times when efforts must be joined and support systems designed to back companies and help them avoid job cuts. That’s the reason the Fund for Business Development of Aguascalientes was there to ease the effects of the most severe economic crises of all times”, said Pedro Gutiérrez Romo, president of the Business Coordination Board

The Fund for Business Development of Aguascalientes (FONDEA) had a very good response from micro, small, and medium-sized enterprises (MSMEs) since any company formally paying taxes and whose fiscal address  in Aguascalientes could become benefitted by FONDEA. The program considered two modes of support:

·         Productive subsidy, which was to be used for the acquisition of technology, infrastructure, equipment, or certifications. The grant added up to $20 million.

·         Business Development Loan, which had to be used for the acquisition of infrastructure, equipment, operating expenses and/or working capital. The budget for this mode was a little over $111.4 million.

Every participating project was assessed by a committee based on the aforementioned criteria. Winners were those that would exert a bigger impact on the economic development of Aguascalientes depending on its viability, profitability, and competitiveness.

The committee was constituted by six representative members of state offices and business associations: the Department for Economic Development, the Department of Rural Development and Agribusiness (SEDRAE), the Department of Finance, the Business Coordination Board of Aguascalientes, the Employers Confederation of the Mexican Republic (COPARMEX), and the Industrialists Group of Aguascalientes.

Results of requests for support as reported by the business chambers:

Subsidy: 192 applications for $44.07 million.

Loan: 142 applications for $279.33 million.